Now, The Detroit News reports confirmation of this model from Volkswagen CEO Martin Winterkorn. While the project has not been given an official green light, that seems like a mere formality given the potential sales opportunity and current U.S. growth.

At present, VW’s SUV lineup consists of the compact Tiguan, priced from $23,820 (including destination charge) and the midsize Touareg, priced from $44,300 (also with destination charge). The proposed new model would be between the Tiguan and Touareg in size, but would be priced below the Tiguan.

To boost profit on the new SUV, assembly would take place in North America, likely at VW’s Chattanooga plant (which currently builds the Passat sedan). There’s a chance it could be built in Mexico, too, since the VW Group has announced a new Audi plant south of the border.

If the new model is smaller than the Touareg, that leaves a space in the lineup for a fourth SUV, too. A seven-seat SUV from Volkswagen was rumored in 2011, so don’t be surprised if the German automaker announces a pair of new SUV or crossover models in the coming years.